Cotton futures edged higher on Wednesday, supported by soaring oil prices, and marked their third straight monthly gain, having risen above 3 percent in November. "It's probably macro factors, especially the surge in oil prices ... cotton is more correlated with oil because of transportation," said Louis Rose, an independent cotton trader and consultant with Risk Analytics in Memphis, Tennessee.
Oil jumped more than 10 percent on Wednesday to over $50 a barrel and its highest in a month as some of the world's largest producers agreed to curb production for the first time since 2008 in a bid to support prices. The natural fiber market awaited Thursday's weekly export sales data from the United States Department of Agriculture.
The March cotton contract on ICE Futures US settled up 0.28 cent, or 0.39 percent, at 71.58 cents per lb. It traded within a range of 70.6 and 71.7 cents a lb. Total futures market volume rose by 1,111 to 17,375 lots. Data showed total open interest gained 10 to 255,483 contracts in the previous session. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was up 2.90 percent. Pakistan has suspended cotton imports from its top supplier, India, saying shipments failed to fulfil phyto-sanitary certification, threatening the $822 million-a-year trade, government and industry officials told Reuters.
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